Samsung’s future as a display supplier for Apple may be in jeopardy

Samsung is the global market leader for OLED displays and that position helped it win Apple’s business for the iPhone X’s display. The iPhone X is the first smartphone from Apple to feature an OLED display and Samsung is the only manufacturer that could supply the displays in the volume that the company requires while adhering to its quality standards.

Many earlier reports have suggested that Apple wants to reduce its reliance on Samsung and third-party suppliers in general. We have seen the company move the production of many of the iPhone’s components in-house and it’s now said to be doing the same for displays as well. Apple has reportedly started developing its own screens for the first time at a secret facility for test purposes.

As reports about Apple cutting iPhone X display orders surfaced, Samsung Display downplayed the potential impact on its business by saying that its business “will not be affected much by a certain customer.” That was in respose to a potential demand drop, though, as the bottom line would surely take a hit if orders from Apple were to completely dry up.

That might very well happen in the future. Apple is reportedly designing and producing its own device displays for the very first time in a secret facility near its headquarters in California. It has made small numbers of screens for testing purposes, sources tell Bloomberg.

Apple is reportedly developing Micro-LED displays which use different light-emitting compounds compared to OLED panels and have the potential to make future devices even slimmer. It’s said that the Apple Watch is likely going to be the first product to feature Apple’s own Micro-LED technology but it’s too soon to say when that iteration of its smartwatch might arrive.

Samsung is working on Micro-LED technology as well and has demonstrated what it can do with it by making a 150-inch TV called The Wall. However, if Apple is able to get the ball rolling on its Micro-LED ambitions, there might come a time when it shifts iPhone displays to this technology to eliminate the need of sourcing panels from third-parties such as Samsung.

Small wonder that shares of screen makers like Samsung, Japan Display and Sharp also declined once this report was published.